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Capital spending by semiconductor suppliers will decline 6 percent from $65.6 billion in 2011 to $61.4 billion in 2012, according to researcher IC Insights.
Only 6 of 35 leading semiconductor suppliers are forecast to increase their capital expenditure budgets in 2012 compared to 2011. ROHM will increase spending 78 percent, the most of all chip suppliers.
Other major suppliers that are forecast to increase capital spending in 2012 include UMC at 26 percent; SK Hynix at 16 percent; TSMC increasing 13 percent; Samsung moving up 11 percent and Intel rising 4 percent.
Intel and four other semiconductor suppliers will account for nearly two-thirds of all capital expenditures in 2012, said IC Insights.
The top 5 capital expenditure spenders for 2012 are Samsung ($13.1 billion); Intel ($11.2 billion); TSMC ($8.3 billion), SK Hynix ($3.7 billion); and GlobalFoundries ($3.1 billion). They will account for 64 percent of the $61.4 billion in semiconductor capital expenditures. Five years ago, the top five spending leaders represented just 40 percent of total semiconductor industry spending.
The top 10 capital spending leaders are now forecast to account for 77 percent of total industry spending in 2012, compared to 55 percent in 2005, the researcher reported.
Fewer suppliers are willing to spend the large sums necessary to build and equip a new fab. As a result, more companies are turning to a fab-lite or fabless business model and relying on foundries to manufacture their devices, according to IC insights.
Capital expenditures by chip companies are used to build and equip new fabs or upgrade older ones. Semiconductor suppliers often increase capital spending when they want to increase chip reduction capacity.